# Phase 7 Part 1: Clean Index Construction

## Shock Filter

- Threshold: rgdp_growth < -10.0%
- Observations excluded: 119
- Countries affected: 71

Top excluded observations:

| Country | Year | Growth |
|---------|------|--------|
| MAC | 2020 | -54.3% |
| LBY | 2011 | -50.3% |
| SSD | 2012 | -50.3% |
| RWA | 1994 | -41.9% |
| KWT | 1991 | -41.0% |
| IRQ | 2003 | -36.7% |
| CAF | 2013 | -36.4% |
| MDV | 2020 | -32.9% |
| MDA | 1994 | -30.9% |
| VEN | 2020 | -30.0% |
| LBY | 2020 | -29.5% |
| LBR | 2003 | -29.0% |
| UKR | 2022 | -28.8% |
| ALB | 1991 | -28.0% |
| YEM | 2015 | -28.0% |
| VEN | 2019 | -27.7% |
| SSD | 2024 | -27.6% |
| KWT | 1990 | -26.2% |
| ABW | 2020 | -26.2% |
| SLE | 1996 | -24.8% |

## Winsorization

- p1 = -2.599, p99 = 0.916
- Clean 2c obs: 6,317

## Rolling Clean Index (5yr MA, min_periods=3)

- Observations: 6,001
- Countries: 194
- Mean: -0.0002
- SD: 0.3687

## Rolling Component Series

- z_growth_rolling: 6,001 obs, mean=0.0662, SD=0.6027
- z_inflation_rolling: 6,001 obs, mean=-0.0424, SD=0.7133

## Homogeneous Rate Index (10y govt bond only)

- Bond yield obs: 771
- Countries: 23
- 3c homog obs: 771
- Mean: 0.1593
- SD: 0.3678

## Index Comparison

| Index | N | Mean | SD | Min | Max |
|-------|---|------|----|----|-----|
| Original 2c | 6,436 | 0.000 | 0.635 | -11.411 | 4.761 |
| Clean 2c | 6,317 | -0.000 | 0.475 | -2.599 | 0.916 |
| Rolling clean 2c | 6,001 | -0.000 | 0.369 | -2.599 | 0.897 |
| Original 3c | 4,271 | 0.024 | 0.537 | -22.158 | 3.215 |
| Homog 3c (10y) | 771 | 0.159 | 0.368 | -1.303 | 1.199 |